The jaw-dropping success of movies such as KGF Chapter 2 and RRR had lifted spirits of multiplex owners, who were looking to shake off the pandemic blues after two long years.
However, latest regional movies including Liger have failed to cheer the Box Office. Besides, Bollywood movies such as Laal Singh Chaddha, Shamshera and Dobaaraa, too, have faced public backlash.
All of this, analysts say, will lead to a bumpy road for listed players like PVR and Inox Leisure.
Deepak Jasani, Head of Retail Research, HDFC Securities says only handful of regional movies do well nationwide. Revenue from South Indian movies unlikely to fill the gap. Multiplexes need good show from Bollywood movies. Pinning hopes on regional movies is too optimistic.
Shares of PVR and Inox Leisure have slumped around 14% each over the past one month as revenue from Bollywood movies account for 40-45% each for both these players. In comparison, the BSE Sensex was unchanged during the period.
Financially…
...PVR reported highest-ever revenue and net profit of Rs 1,000.4 crore, and Rs 68.3 crore, respectively, in the June quarter of FY23.Inox, meanwhile, reported record revenue of Rs 589 crore, and profit of Rs 74 crore.
However, this was largely driven by higher food and beverages revenue, lower employee costs and higher other income.
Further, Net Box Office Collection, as a percentage of revenue, improved only 2 percentage points for both, PVR and Inox Leisure.
Moreover, Inox Leisure clocked a mere 6% increase in footfalls above the pre-pandemic levels, while PVR is yet to recover the lost ground.
G CHOKKALINGAM, FOUNDER AND CHIEF INVESTMENT OFFICER, EQUINOMICS RESEARCH says, movie goers are switching to OTT. Low budget movies are being released directly on OTT platforms. Big ticket movies make their way to streaming apps after two-three weeks of Box Office run. OTT will eat into multiplexes’ revenues in the long-run.
Against this backdrop, analysts see another 10-15% correction in stock prices. They also expect weak earnings to put pressure on price-to-earnings valuation multiples.
On Friday, stock-specific action and auto sales data will guide investors. Globally, market participants will await the US jobs data.
 "Boycott Bollywood hits PVR, Inox Leisure's stocks")
